Investing.com - The Australian dollar edged higher against its U.S. counterpart on Thursday, but gains were limited as concerns over the debt crisis in the euro zone persisted ahead of an Italian debt auction later in the day and weekend elections in Greece.
AUD/USD hit 0.9966 during late Asian trade, the session high; the pair subsequently consolidated at 0.9940, adding 0.08%.
The pair was likely to find support at 0.9874, the low of June 7 and resistance at 1.0006, the high of June 11.
Market sentiment weakened after Moody’s rating agency downgraded late Wednesday Spain’s credit rating by three notches, from A3 to Baa3, citing the nation’s increased debt burden, weakening economy and limited access to capital markets.
Meanwhile, investors were cautious as Italy was preparing to sell up to EUR4.5 billion in long term bonds later in the day, amid growing fears the country will be the next euro zone member to require a bailout. Rome saw borrowing costs surge to the highest level since December at an auction of 12-month government bonds on Wednesday.
Markets were also jittery ahead of highly anticipated Greek elections on Sunday, which could determine the country’s future in the euro zone.
In Australia, a report by the Melbourne Institute showed that inflation expectations rose 2.3% in May, following a 3.1% rise the previous month.
The Aussie was lower against the New Zealand dollar with AUD/NZD shedding 0.25%, to hit 1.2810.
Also Thursday, the Reserve Bank of New Zealand held its benchmark interest rate at 2.50%, citing a deteriorating global economic outlook. The central bank also pushed back its forecast for when future rate hikes would start.
Later in the day, the U.S. was to produce official data on consumer price inflation and the country’s current account, as well as a government report on initial unemployment claims.
AUD/USD hit 0.9966 during late Asian trade, the session high; the pair subsequently consolidated at 0.9940, adding 0.08%.
The pair was likely to find support at 0.9874, the low of June 7 and resistance at 1.0006, the high of June 11.
Market sentiment weakened after Moody’s rating agency downgraded late Wednesday Spain’s credit rating by three notches, from A3 to Baa3, citing the nation’s increased debt burden, weakening economy and limited access to capital markets.
Meanwhile, investors were cautious as Italy was preparing to sell up to EUR4.5 billion in long term bonds later in the day, amid growing fears the country will be the next euro zone member to require a bailout. Rome saw borrowing costs surge to the highest level since December at an auction of 12-month government bonds on Wednesday.
Markets were also jittery ahead of highly anticipated Greek elections on Sunday, which could determine the country’s future in the euro zone.
In Australia, a report by the Melbourne Institute showed that inflation expectations rose 2.3% in May, following a 3.1% rise the previous month.
The Aussie was lower against the New Zealand dollar with AUD/NZD shedding 0.25%, to hit 1.2810.
Also Thursday, the Reserve Bank of New Zealand held its benchmark interest rate at 2.50%, citing a deteriorating global economic outlook. The central bank also pushed back its forecast for when future rate hikes would start.
Later in the day, the U.S. was to produce official data on consumer price inflation and the country’s current account, as well as a government report on initial unemployment claims.